Relmada Therapeutics, Inc. (RLMD) Earnings Call Transcript & Summary

Great. Well, maybe we'll get started here. Thanks, everyone, for joining us. I'm really pleased to be joined by Sergio Traversa, CEO of Relmada. Thank you so much, Sergio.

Thank you, Andrea, and, thank you, Goldman, for the invitation as always.

Yes. So exciting year for you with upcoming pivotal data coming in the second half of this year. Maybe to level set here as you think about Reliance II, your RELAY trial that's coming next year. Remind the audience how these trials are designed in adjunctive MDD. When can we expect to see some data here and help frame expectations?

Okay. Let's start from how the trial design, right? So we come from some experience in running Phase III clinical trials. So we did 2 in the past. The design is somewhat similar. Now we made a lot of amendments and changes to improve, especially the placebo controlled. But in terms of design, it's really simple. So it's 2 doses, it's placebo and 25-milligram of REL-1017 and the trial lasts 4 weeks, and the primary endpoint is the delta between placebo and the drug at day 28. Everything else has been already done. So there is no more need for the long-term safety that 12 months has been completed. The Phase I patient population renal, hepatic is all done. So that's made the design very, very simple. So primary endpoint 28 days, different within placebo and the drug.

Maybe you remind us or maybe help provide some context. You referenced your prior Phase III trials here and I think in both of those, you did see an elevated placebo response. What have you implemented in these trials now to try to control for that?

Well, thanks for the question because Andrea, it has been the real focus of the program. As everybody knows, the results of the 2 trial have not been like good enough to file for an NDA, although the second one is [indiscernible] P-value 0.051. So it was really borderline and missed by a hair, [but in any case,] not good enough for a filing. So the focus of the 2 Phase III clinical trials running now was to be able to control the placebo effect. And so we made changes across the board in many aspects. So we do believe we kind of figured out what did not go right in the other trial. And something was more controllable. Something else was really COVID-related and so the -- to have oversight on a large number of sites or the 100 sites in 2 different clinical trials without the ability to go into the sites and most of the interviews for the rating of the patient were done, we assume. So it was kind of like [indiscernible] environment where we didn't know at that time, but it really impacted the data of the studies. So we made changes in 3 different areas and [indiscernible] to enroll the right patients and to control the placebo effect. And so the protocol -- so the 3 changes are protocol, site selection and patients. So I start with the protocol. So the protocol was the first Phase III trial program that we did. And so it was -- I don't want to call it complex, but it was like it was aimed to detect a lot of information, especially about safety and cognition and other aspects. Now all that is done. So the protocol has been simplified quite a bit in terms of there is no more requirement of all the safety like ECG and because we have the data. And so we don't need to do all that. So that translates in the patients having a lot less contact with the investigator and spending a lot less time in the site. And that by itself, it should help to control the placebo effect. And so simplified protocol. The site selection is no magic because you only see if a site is a good site or not in terms of controlling placebo effect that you see the data. But we have a luxury that we have data, proprietary data, on over 100 sites that participate in the previous clinical trials. And so this data, we use this data, and we can clearly see the site that being able to control placebo effect and the site that we are not able to control placebo effect. In particular, as you remember, there were 2 sites that had particularly like not very good data. And so clearly, these sites are not part of the site selection anymore. So site selection has been somewhat optimized. We do have a certain number of sites that are new. And we do as much as possible to keep like an oversight on these sites. So looking at the blinded data that clearly don't tell you anything about efficacy or -- but you can see there is some anomaly, right? If you see over the 4 weeks where [indiscernible] is detected or the patient is interviewed if you see like zigzag or like data that are outside of the normal behavior of placebo and a drug, you can call the sites and verify if it was the wrong patients or something happened related with having data that are not like in line with what you expect for placebo or for the drug. And so we try to keep an eye as much as possible on the site's behavior. We are limiting the number of patients. It was an issue with the previous clinical trials, right? We had a few sites that had an oversized number of patients recruited like over 20 per site. And clearly, that can have an oversized impact on the overall trial. So we are trying to avoid that. So we try to limit without giving a specific number of patients maximum for each site, but between the oversize and limiting the impact of every single site on the trial should definitely help to avoid what affected us in the other trials. The last is the most important is the patient selection. For a variety of reasons, we do believe that at least a sizable part of the patients enrolled in the previous trial were not really affected by biological depression. It was mostly a consequence of the COVID situation where there was a lot of reactive depression that clearly goes away with placebo and maybe sometimes just with the contact with other people and they're reassuring that you're not sick and so to avoid that, we put a certain parameter and we do have an adjudication process that is rather severe. So we had 4 different steps where the patient is evaluated and is considered for enrollment of the sites. We have the CT&I SAFER that is a second -- that has contact the patient and really diagnose the patient using a different questionnaire from SAFER. Then we have an internal team that reviews all the data without contact with the patients. And the last, we do have an external adjudicator independent that sign on on the patients. So it's a 4-step process. And that -- there is a lot more oversights on the patient selected is now is possible because people can actually travel. And I do believe that the most important of the amendment that we expect to make a big difference in the data is the requirement for medical and pharmacy records. So this is an adjunctive treatment. So the patient, the patient has to be on treatment with an antidepressant and not to respond to the current treatment. So then he can be enrolled in the study. In the previous trials that was industry norm. There was no requirement to provide a proof that you actually have been taking antidepressant that you have been diagnosed with depression. And we are now requiring that. So every patient to be enrolled has to provide his -- like his family doctor, whoever diagnosed him or her with depression and provide a pharmacy record that prove that has been at least purchasing antidepressant from a pharmacy for a certain amount of time. That should support the patients that are enrolled are really affected by depression.

Got it. And as you think about these patients, just remind us what the inclusion, exclusion criteria are for the trial.

Yes. Well, the protocol inclusion, exclusion criteria, but there are a lot of them and from the most detail. But in general, the more stringent or the inclusion, exclusion that the patient has to be affected by depression. He has to be treated and has to be taking an antidepressant for at least 6 weeks. So that's the key criteria. So -- and should not have an improvement from -- since started the treatment of -- that has to be less than 50%. Secondly, he does not respond well to the current treatment. That's the basic inclusion, exclusion. Then of course, the [indiscernible] in other clinical trials [indiscernible] diabetes and concomitant [indiscernible] have an exclusion criteria, that is taking any kind of drugs like amphetamine, methamphetamine, opioids, but also THC, marijuana. And I mentioned it because not surprising, but there is a large percentage of patients, I believe, is close to 10%. They present and they are taking marijuana. So that's, unfortunately are depressed and so would be risky to include the patients. So concomitant medication is one of the -- also the inclusion, exclusion criteria more than inclusion.

And what is the baseline cutoff for your HAM-D score for the patient.

Well, we use the HAM-D, yes, it is 19.

How does 19, I guess, maybe if you could provide some context relative to other clinical trials because maybe that's been a focus that if you have maybe less severely depressed patients. It may be more difficult to maybe tease out that signal. Help us understand how you came to 19 as the cutoff?

Right. Well, it's a good question. 19 is kind of the industry standard. It doesn't mean that like you enroll a lot of patients with 19 HAM-D. So we use HAM-D for diagnosis and then MADRS for baseline and during the trial. So 19 HAM-D correspond very roughly about 25, 24, 25 MADRS scale. It's kind of industry like standard for depression clinical trial. I do, as you said, and I do fully agree because we have seen the data. The more severe is the patients and is the more the effect of the drug shows up. And placebo, if you're really severe depressed, only does that much. So -- but the 19 is the cutoff minimum. If you look at the average blinded mix data between placebo and drug. I do believe is around 33, that is somewhat in line with the previous trial. So severity of the patient enrolled is much higher than the minimum required to get in.

Why not have a higher cutoff maybe to help, maybe ensure that you are getting a more severe patient population?

Well, that would -- like the sites they want to have more room in the patient [indiscernible]. We don't know because we haven't really [indiscernible]. They may want to have like a larger range of patient population that reflect more the real patient population. So there was no specific reason, but it's more to a wide -- a widen pool of patient were to pick the patients to -- for recruitment. So no specific reason. It's just you need to have a cutoff. And also the concern, if you have put a cutoff very high, the site say, okay, it's too restrictive and there is competition, too, on [indiscernible] clinical -- so you have to keep [indiscernible] criteria. They are not like [indiscernible] disadvantage [indiscernible].

Maybe when you've spoken in the past, you've disclosed -- [indiscernible] and that seems to be well above at least your prior trials. How does that compare to the extent that you're aware of other clinical trials in depression here? And what would you maybe pinpoint as the nature of those failures?

Yes. I can give a lot of details on this because as you may imagine, the attention and the focus is on enrolling patients that are like suitable to be included in the trial. And the -- how can I say, we don't really know all the -- these are proprietary data. We disclose it because we tend to be very shareholder friendly and investor friendly. So we tell as much as we can. And so -- but we do believe that the 75%, 80% is on the higher side of the screening failure. We are trying to work on that and -- but we -- in the previous trial, what I can tell you, it was around 50%, and that was lower. We have been told by the expert that is more in the range of the industry. And so we are trying to see if there is a way without increasing the risk to improve the screening failure. But we look at the reason for screening failure. And there are somewhat legitimate like THC is a big one. Previous clinical trial enrollment is another sizable one. I would say, half of the patients, they fail for blood work, right? Thyroid, hormone, uncontrolled diabetes, and there is not much you can do about that, right? It's unfortunately, there are patients that in the real world that you can treat, but in a clinical trial, you want to be more careful about those, especially like the thyroid. It's one effect is depression, but it doesn't respond to drugs because it's related with the thyroid hormone. So we are trying to improve it. More recently, I believe we touched on that in one of our past conversations. We expanded a little bit the range of allowed medication as a reaction to the previous trials. We put parameters that were very restrictive. So then with the fee that we decide and we only listen to what the site tells us. There was certain restrictions that there was a lifetime ban for ketamine. [indiscernible] well, if somebody has been treated with ketamine like 3 years ago is not going to affect your trial. So now that restriction has been lifted and there was like a ban in the use of benzodiazepine because they are depressed and we changed that angle and now benzodiazepines are allowed as long as they are taking like to sleep and they are not like taking all day and to stay in the bed all day. And so there is some small modification that should help over time. But look, the goal is really to have a positive study and to have a positive study, we know we have to enroll patients that are affected by depression.

Maybe on that point as a follow-up. If you are enrolling patients who are taking, say, benzodiazepines maybe even at a low level. How are you confident that, that won't skew your data or maybe skew the response since benzodiazepines are used as antidepressants?

Yes. So you look at the dose. If benzodiazepine, they don't last a long time. So if you take it in the evening before to sleep just to induce sleep, then it is fine. One thing that you don't want to do during the 4 weeks is to change the habit of the patients, right? It would be easy to say, okay, I enrolled you if you stop taking benzodiazepine for 4 weeks, but there will be a change in the habit and it probably would have a much bigger impact than just to leave the status quo. And if you're taking the same dose of benzodiazepine on daily basis just to sleep [indiscernible] the drug is not really having the effect. So maintaining the status quo is very important.

As you think about these protocol amendments that you've put into place now to control the placebo response, I guess how much risk is there that 30% of your patients in Reliance II were actually enrolled before any of these were implemented as you think about the data that's coming later this year?

Right. As you may imagine, we get that question quite a bit. And so we look into these patients. Of course, they are blinded studies, no way to know if they are a good patient, not good patients. But the level of confidence is that in 2 different parts. One, half of these patients were enrolled after the COVID restrictions were lifted where the data that we have in the other studies, they were very good. And so of the 80, 90 patients enrolled pre-amendment, half, they've been enrolled, only half have been enrolled during the COVID restrictions. So the number gets down to like 30, 40 patients that really could have been affected by the COVID restrictions. And all in all, I mean, if we cut this data in a million different ways. But in reality, if you like getting to the bottom line, we had 2 sites that had bad data and affected the old trial. Excluding these 2 sites, the data would have been like nice and the study would have been statistically significant. So these 2 sites, they are not. They have never been in Study 302, so you put all together, and so that's one aspect. The second aspect is that we look at the data post COVID lift of the restrictions, how data look like. There was a 6-point delta between the placebo and the drug. So unfortunately, it was only 60 patients because we stopped early, but the data we're looking very good with a non-amended protocol. So now with the amended protocol, and we're enrolling 200 patients. And if you add the 30, 40 enrolled after the COVID restrictions from the pre-amendment. So you get to like 200-plus patients that they should have -- we expect to have good results and the delta from placebo, assuming no deltas or zero effect of the drug in the previous, like 70, 80 patients. The delta in the following 200, 220 has to be like 2.5 points or 3 points. If it's flat, it's 3 points, right? So it is feasible and the bar is not very high. So with all -- we have done -- all we are doing, everything we are doing it should be able to overcome even if these data are not that great. If we assume that the first 70, 80, 90 patient pre-amendment, they have a delta of 2.3 points that was the overall delta then the following 200 patients, they should have a delta 2.5 points and we are fine.

What are you powering your study to detect?

It's powered to detect 2, 2.5 points delta, depending on the standard deviation. That would be the minimum, right? We hope we can do better than that, but that would be the minimum to detect the 0.05 P-value.

Maybe on that point, because you have had some, I think, very robust data in the Phase II trial. Maybe remind us the profile that you've seen there. How important is the rapid onset of action you're seeing that be touted as a selling point for some other drugs that are on the market right now. Where does REL-1017 eventually fit into the treatment paradigm?

Yes. So the rapid acting is a very good feature to have and differentiate from most of the other drugs. And the -- especially from the antipsychotic, they are indicated for adjunctive treatment. Remind that there is no antidepressant approved as an adjunctive treatment of depression overall. And so the -- we discussed that with the FDA. We actually wanted to leverage as much as possible the rapid acting, but I mean, as the FDA seems a lot more oriented. They do believe rapid acting it's on the label, it's a good feature to have. But they are very much oriented in having duration of effect. And so like if we would have a primary endpoint of 7 days was not acceptable by the FDA. It's nice to have, but we want to see if the drug works for at least 3, 4 weeks when the patient is on drug. So they wanted the primary endpoint to be day 28. So a nice feature to have, it is not critical on the -- at least for the FDA. Commercially, yes, it is you want to have a rapid acting as much as possible. But it's very important that the drug lasts over time. For the European is even more important. European duration of effect and the impact on the economics. If you can go to work earlier, it's even more important than in the U.S. So duration is important.

And as the profile of REL-1017 has emerged, whether it's the Phase II study, your open-label study. What has been the receptivity from the medical community as to the profile of this drug?

Yes. Well, the feedback has been, if you can do something that need to be the same, but even close to what the Phase II data looks like, it will be very well accepted. What we've done is we are not emphasizing it because efficacy is critical to get approval. But the tolerability profile of REL-1017 is something that on the marketplace according to the KOLs and doctor, it's very, very important. I mean the antipsychotic, they're used widely as adjunctive treatment. And the efficacy, there is some efficacy, but it takes a while before you can see any efficacy. And the tolerability profile is not as ideal because diabetes, metabolic changes over time, these are chronic drug. So to have a clean safety and tolerability profile like REL-1017 on the marketplace will be very important, assuming the usual efficacy at that side. That's why we are focusing on efficacy first.

Maybe remind us the work you've done with the human abuse potential studies.

Yes, I do believe that at Relmada, we have done the most extensive abuse potential program ever done, ever done for [indiscernible] we've published the data, right? There is a placebo like profile. So we feel very comfortable. We have a very, very good team that specifically has done and followed for the old program. One of the member is the former head of the DEA. So it's -- they are very -- we have 2 former FDA member retired that help us out. And they all said, with this profile, initially, it should be scheduled for 5 and eventually after like 1 or 2 years of experience, there is no sign of abuse, it could be even be a nonscheduled drug. And what I can tell you is that in all the data that we have seen in the abuse studies that were specifically designed for that, but also in the old program, Phase II and especially the Phase III long term. And we haven't seen one single case of attempt of abuse or of the drug, consider that we did propose to the FDA 2 weeks in the long-term safety, they only come once a month for the visitor, coming once a month to the clinic for the visit. We thought about giving the patient to go home 2 weeks of therapy. So it would be like 14 tablets and/or 15 tablets. And the FDA said, no, you don't want the patient to come in every 2 weeks, give it 30 tablets. So that's a sign that was before data. So that's a sign that the FDA, of course, [indiscernible] that taking everything very seriously, but they don't seem very preoccupied about safety or about the abuse potential of the drug. 30 tablets is a lot.

Maybe given the clean signal that you've seen there and the lack of an abuse potential, remind us why the assumption is that you would start with a Schedule 4 or 5.

Well, it is mostly for the parent drug, right? It's the isomer of racemic methadone. So I mean, some cautiousness would be required. That's according to the team. And -- but again, there is no sign of any potential for abuse. And so dextromethorphan has a long history. So it is an over-the-counter drug. And it's not that different in terms of mechanism of action. So this to be -- to be cautious Schedule 4 or 5.

What are you hearing from the medical community on that front? A schedule 4 or 5 versus no schedule at all, not a controlled substance. How would that impact how they think about using this drug?

Yes. Well, I'll tell you the -- we spoke with a lot of doctors and KOLs and not [indiscernible] also prescribing doctors and in the sites, the common answer is that many of the doctors don't even know if it's Schedule 4 or 5. And the issue would be Schedule 2 would be restrictive. Schedule 3 is already well more and more accepted. Schedule 4, 5 is not. They don't -- it's not a focus. You can repeat the prescription. So that -- it doesn't carry any burden for the patients of the -- or the doctor. So 4 or 5 is very, very benign. And Schedule 2 would be the one that you definitely don't want, although all stimulants and they're used for kids. They are Schedule 2 and they sell a lot. So even Schedule 2, if you have a good drug, would not be like a deterrent, but like the -- but Schedule 4, 5 is definitely not -- would not be an issue.

If you -- I mean, maybe a follow-up there. If you were Schedule 4 or 5, which recognizing it is a much lower bar than a Schedule 2 for these physicians. But -- how would that impact it, I guess, maybe as you think about other antidepressants on the market that really minus SPRAVATO don't have a schedule there, what particular patient will be prescribed REL-1017.

That's a good question. Well, REL-1017, if approved would be indicated for adjunctive treatment. So it is a second line no matter what. So they would not compete directly with the current antidepressant. Real competition would be the antipsychotic. And they are not scheduled, but clearly, they have their own baggage.

Maybe in the last couple of minutes, we can jump over to your REL-P11 program, the Psylocybin remind us the genesis of this. Why there's this interest to explore this agent in obesity. Why does that make sense right now?

Yes. And I'm glad you asked the question because sometimes [indiscernible] also helps a lot, but you have to be able to recognize when you have data that could potentially have a big reward. And P11 was originally studied as a neurogenetic, as neuroplastogen and similar to an NMDA, so it helps to grow nerves. So the indication could have been -- and could be very various. Anything related with neuroprotection like one thing that we have been looking. We are still looking its stroke, occipital stroke where the recovery after stroke. But during these studies, neurogenesis, it is much slower or it is slower in obese people, but in obese animals as well. So the team, the Chief Scientific Officer to better detect the neurogenetic effect of P11, of Psylocybin, he thought about using rodent, the artificially made fat, made obese with the high fructose, high fat diet. And -- but the goal was to show the effect of the drug as a neuroplastic agent. That has been demonstrated before, but we wanted to have our own data. And the neuroplastic effect was seen. But what has also been seen is that in the patients who are taking placebo and the high fat, high fructose diet that nothing changed and the rodent stayed the same weight. And in the patient that we administered very low dose, we are talking about 0.5 to 1 milligram versus 20, 25 of the psychedelic use for depression and for a psychotic indication, we use 1/20th lower dose. So where there is no seen psychodelic effect. And the rodent treated with P11, they lost weight about 10%. Glucose went down of an amount similar, if not more than metformin and liver that was clearly white and full of fat, it got cleared, it became pretty much normal after a few weeks. Based on this data and we repeated the study because you don't want to have by chance same results. We looked at the combination with GLP-1s as well because they are very popular and they work and they have their own issues for like a loss of muscle and so there'll be something more that can be done in that space. But we spoke with quite a bit of opinion leaders in metabolic, which we were not really expert. And they all said, look, this side there is a huge need for metabolic drug that can help or that can be combined with GLP-1 or can be by themselves. And the indication we haven't chose the specific indication now because it works on glucose, it works on weight and it works on fatty liver. So we will -- we are planning to start the Phase II proof of concept. Hopefully, everything goes well, we start this year, data sometime next year, probably first half. And based on the data in human, it would be obese patients and will decide which is the easiest indication to pursue to get approved.

Perfect. Well, we are just up on time, but Sergio, any last remarks as we await Reliance II REL data.

Well, we really hope this time we'll get it right. It's a patient deserved drug like 1017 approved and make it available. And so we really hope that this time, we are doing everything we can and it's possible to do to get positive data, and we believe we will.

Great. Well, with that, thank you so much, Sergio.

Thank you, Andrea. It's always a pleasure. Thank you, everyone.